Emerging Russian Multinationals: Innovation, Technology, and Internationalization

This article examines the role of technology and innovation, as ownership advantages, in the internationalization process of Russian companies. It focuses on three distinctive groups of firms-medium-technology manufacturing enterprises, software and IT companies, and state corporations. We identify different roles of innovation in internationalization of these companies and provide corresponding examples. First, medium-technology manufacturing enterprises tend to expand abroad led by a technology-seeking motive, seeking to boost their technological competence through foreign acquisitions. Second, companies in the emerging IT and software sectors internationalize driven by innovation and using their competitive advantage. This international expansion is often organic in terms of establishment of greenfield subsidiaries rather than acquisitions of foreign firms. Third, state corporations engage in international operations, too, and the role of innovation differs. This internationalization may be either technology- driven or technology-seeking. The article concludes with managerial recommendations and policy implications.